Everything You Need to Know About the 2027 Final Rule

The 2027 final rule is here, and as always, it’s packed with things you’re going to want to know headed into next year. Here’s an abridged version with everything relevant to rehab therapists — and yes, as long as this blog is, it’s still much shorter than the actual final rule.  

The conversion factor goes down.

You’re here to hear about the money, so let’s get right to it. As slated, the two conversion factors have decreased from last year:

• The qualifying APM conversion factor is getting a projected decrease of $0.62 (-1.83 percent) from the current conversion factor of 33.5675 down to 32.9548
• The non-qualifying APM conversion factor gets a projected decrease of $0.77 (-2.31 percent) from the current conversion factor of 33.4009 to 32.6286. 

PE RVUs for rehab therapy are getting a boost over the next few years.

A win for rehab therapists is the fact that many of the most common codes they use in everyday practice are getting a boost this year and the next few years. As APTQI notes in this article, the cumulative effect of the increases to RVUs and prices amounts to an overall 0.7% increase to pay for rehab therapists, even taking into account the decrease due to conversion factor cuts.  

As CMS notes on page 1974, “The proposals to update code valuation and improve the accuracy of the practice expense methodology are estimated to have a significant positive impact on clinical psychologists and clinical social workers, with smaller increases to physical and occupational therapists, interventional radiology, and vascular surgery.”

If you’re looking to dive into the nitty-gritty, here’s a spreadsheet including all the RVUs, Geographic Adjustment Factors (GAFs), and Geographic Practice Cost Indices (GCPIs) for 2027. 

The indirect practice cost index is being phased out.

If you’ve ever dug into the calculation of RVUs, you know there’s a lot that goes into ultimately arriving at the figures that determine provider pay in conjunction with other numbers similarly derived. (A lot of math, in short.) One important change for rehab therapists is the reduction and eventual removal of the indirect practice cost index (ICPI) over the next two years. The ICPI is what CMS has used to allocate indirect costs to each code, but as CMS acknowledges in this final rule:

“(W)e have identified various limitations of the survey data, especially as the data we use has become increasingly dated and are intrinsically limited to small, selective samples based on pre-determined assumptions about where costs are likely to differ, and, as we addressed in CY 2026 PFS rulemaking, have not been adequately updated.” 

CMS is thus halving the applied measured variation in the ICPI for 2027 and doing away with it altogether for 2028.   

The KX modifier increases again, and the medical review threshold holds steady for one more year. 

As expected, the final CY 2027 KX modifier threshold amount landed at $2,540 for physical therapy and speech-language pathology services combined and $2,540 for occupational therapy services.

Similarly, the medical review threshold sits at $3,000 for physical therapy and speech-language pathology services combined and $3,000 for occupational therapy services — although as we noted in the proposed rule breakdown, CMS is going to start adjusting that number based upon the increase in the Medicare Economic Index (MEI). 

RTM gets some changes, but not all the ones we were expecting.   

CMS put the word out in the proposed rule that RTM and RPM codes — and the services themselves — were under scrutiny. At issue was the concern posed by the Office of the Inspector General (OIG) that RTM/RPM services were being provided to people who weren’t patients.

To address these concerns, CMS is implementing additional guidelines around the provision of these services. 

• First, CMS stipulates that remote monitoring services can only be provided to an established patient, which for the purposes of rehab therapists is “one who is receiving services furnished under a therapy plan of care that may extend throughout the length of that episode of care.”

• CMS is also mandating an initiating visit before providers begin remote monitoring services with a patient, which must be face-to-face (either in-person or via telehealth), although the visit itself does not have to be for the sole purpose of discussing remote monitoring services.They note that for the initiating visit “(w)e are not finalizing any additional documentation requirements at this time, as we believe additional documentation requirements may create unnecessary administrative burden.” 

• CMS also proposed  a provision that would only allow payment for RPM and RTM services provided by clinical staff employed by the practice. As detailed in the comments received, the definition of “employed” by the practice is thornier than imagined, with specific contracting and employment agreements to unpack along with questions about third-party vendors. For that reason, CMS is implementing a two-year delay in its rule, at which point services would have to be provided by a direct employee and contracting those services to a third-party would no longer be allowed (although practices will still be able to use vendors for the technology). So, check this space again in November 2028!   

As we covered in the proposed rule recap, CMS was also considering bundling the respective RTM and RPM codes into four new HCPCS G-codes:

• GRPM1: RPM initial set-up and patient education. 
• GRPM2: Remote monitoring of physiologic parameter(s) (eg, weight, blood pressure, pulse oximetry, respiratory flow rate), per calendar month, including:
  
  • Device(s) supply with daily recording(s) or programmed alert(s) transmission.
  • 2 or more days of data transmission.
  • Treatment management services, requiring at least one real-time interactive communication with the patient/caregiver; time totaling at least 20 minutes.

• GRTM1: RTM initial set-up and patient education.
• GRTM2: Remote monitoring of therapeutic parameter(s) (eg, therapy adherence, therapy response, digital therapeutic intervention), per calendar month, including:
  
  • Device(s) supply for data access or data transmissions.
  • 2 or more days of data transmission.
  • Treatment management services, requiring at least one real-time interactive communication with the patient or caregiver; time totaling at least 20 minutes.

The reasons given related to the aforementioned concerns about misuse as well as notional concern about the administrative burden of so many RTM/RPM codes. However, for all the uproar, CMS has simply left the potential changes as just that: potential, stating that “After consideration of public comments, we will take the comments into consideration for possible future rulemaking.” 

Also worth noting amidst the other remote monitoring changes is this tidbit: “The AMA informed CMS that in response to our concerns over a lack of data to inform accurate valuation of these services, all 19 RPM and RTM codes will have their practice expenses reviewed at the January 2027 RUC meeting.”

SLP codes are finalized, and on the Medicare Telehealth Services List.

As detailed in the proposed rule and a separate blog, the speech-language CPT code 92507 (Treatment of speech, language, voice, communication, and/or auditory processing disorder; individual) is being deleted and replaced by ten new codes: 

• 92654: Treatment of fluency disorder (eg, stuttering and cluttering), direct (one-on-one) patient contact; initial 30 minutes 
• 92655: Treatment of fluency disorder (eg, stuttering and cluttering), direct (one-on-one) patient contact; each additional 15 minutes 
• 92656: Treatment of speech sound production disorder (eg, articulation, phonological process, apraxia, dysarthria), direct (one-on-one) patient contact; initial 30 minutes 
• 92657: Treatment of speech sound production disorder (eg, articulation, phonological process, apraxia, dysarthria), direct (one-on-one) patient contact; each additional 15 minutes 
• 92658: Treatment of language comprehension and expression disorder (eg, receptive and expressive language), direct (one-on-one) patient contact; initial 30 minutes 
• 92659: Treatment of language comprehension and expression disorder (eg, receptive and expressive language), direct (one-on-one) patient contact; each additional 15 minutes 
• 92660: Treatment of speech sound production disorder (eg, articulation, phonological process, apraxia, dysarthria) and language comprehension and expression disorder (eg, receptive and expressive language), direct (one-on-one) patient contact; initial 30 minutes 
• 92661: Treatment of speech sound production disorder (eg, articulation, phonological process, apraxia, dysarthria) and language comprehension and expression disorder (eg, receptive and expressive language), direct (one-on-one) patient contact; each additional 15 minutes  
• 92662: Treatment of voice, upper airway dysfunction, and/or resonance disorders, direct (one-on-one) patient contact; initial 30 minutes 
• 92663: Treatment of voice, upper airway dysfunction, and/or resonance disorders, direct (one-on-one) patient contact; each additional 15 minutes 

In the final rule CMS has stated that these codes have been added to the Medicare Telehealth Services List.

In response to concerns about the deletion of code 92507 by SLPs working with the pediatric population, CMS has created HCPCS code G0903, with a descript of “Treatment of speech, language, voice, communication, and/or auditory processing disorder; individual; for the pediatric population age 21 and under.” G0903 is an always therapy service and is added to the separately payable always therapy codes subject to MPPR. It has a proposed work RVU of 1.30 and a PE RVU of 0.97.

There are a few more CPT coding changes.

Under Existing Invoices for Direct PE Inputs:

• CPT code 97113 (aquatic therapy pool) is getting a huge pricing increase from $36,000 to $192,171
• CPT code 97610 (kit, low frequency ultrasound wound therapy(MIST)) is getting a price cut from $320.18 to $125.

Among the biofeedback training codes, CMS is finalizing: 

• Changing CPT code 90901 (Biofeedback training by any modality (eg, EMG, EEG, ECG); initial 15 minutes of direct patient contact by physician or other qualified health care professional) to a timed code.

• Adding CPT code 90903 (Biofeedback training by any modality (eg,EMG, EEG, ECG); each additional 15 minutes of direct patient contact by physician or other qualified health care professional (List separately in addition to code for primary procedure)) as an additional code to bill for times services past 15 minutes, a sometimes therapy service, and a service eligible for telehealth.

MIPS is starting a slow ride into the sunset—but continues to update regardless. 

CMS kicks off this year’s QPP updates with a modification to their long-in-the-works plan to retire traditional MIPS—maybe. While MIPS is still going away in favor of MVPs, it might not be doing so on the previously suggested timeline. From page 1555 of the final rule:

“We are finalizing, with modification, our proposal to sunset the traditional MIPS reporting option. Specifically, we are delaying the sunset of traditional MIPS by two years until the CY 2031 performance period/2033 MIPS payment year. Therefore, beginning with the CY 2029 performance period/2031 MIPS payment year, MVPs would be the only reporting option for MIPS eligible clinicians who do not participate in a MIPS APM. Traditional MIPS will remain available through the CY 2030 performance period/2032 MIPS payment year.”

If you read the above passage and came away confused, rest assured you’re not alone. Later passages that cite 2031 as the mandatory transitional point between MIPS and MVPs suggest that 2031 is in fact the cutoff, however. 

Fortunately, other points about the MIPS/MVP programs are a bit clearer. CMS has:

• Set the performance threshold at 75 points for the 2027/28 performance year
• Finalized its proposal to include virtual groups in MVP reporting beginning with the CY 2029 performance period/2031 MIPS payment year.
• Renamed the Rehabilitative Support for Musculoskeletal Care MVP to Rehabilitative Support MVP “to better represent the measures and activities included in the MVP.”
• Updated all existing MVPs to include MIPS core measures
• IMplemented  the MIPS core measure designation in traditional MIPS and MVPs for the Quality Performance category
• Finalized its proposal to no longer use the high priority designation as one of the retention criteria for MIPS quality measures and the MVP inventory
• Finalized the proposal to remove the current quality measure data submission requirement of one outcome (or one high priority measure if an outcome measure is not available) for traditional MIPS and MVP reporting and replacing it with the requirement that eligible clinicians must report at least one MIPS core measure
• Added six new improvement activities under the Care Coordination and Advancing Health and Wellness Subcategories

The newly-renamed Rehabilitative Support MVP got some additional updates.

As discussed above, CMS is adding core measures to each MVP. Here’s what they added for the Rehabilitative Support MVP:

• Q050: Urinary Incontinence: Plan of Care for Urinary Incontinence in Women Aged 65 Years and Older
• Q155: Falls: Plan of Care
• Q520: Functional Improvement for Patients with Back Impairments

They’ve also added IA_CC_9: Implementation of practices/processes for developing regular individual care plans as an Improvement Activity for this MVP and deleted IA_BE_15: Engagement of Patients, Family and Caregivers in Developing a Plan of Care, and IA_CC_12: Care coordination agreements that promote improvements in patient tracking across settings.

Rehab Therapy Quality Measures are shifting from FOTO to PROMIS

If you’ve kept your eyes on rehab-specific quality measures for a few years, you’ve probably noticed that the ones CMS had implemented in MIPS were Focus on Therapeutic Outcomes (FOTO) quality measures. The gripe that providers have had, and have posed to CMS, was the difficulty in accessing FOTO; the suggested fix was that CMS change to something that was more widely available. And it seems that CMS has heard those complaints and acted.

CMS is proposing to replace seven of the existing quality measures with five new ones, with the only substantive change being that the new measure uses Patient-Reported Outcomes Measurement Information System (PROMIS) measures instead of FOTO: 

• Q518: Functional Improvement for Patients with Neck Impairments is replacing Q217: Functional Status Change for Patients with Neck Impairments
• Q519: Functional Improvement for Patients with Upper Extremity Impairments is replacing Q221: Functional Status Change for Patients with Shoulder Impairments and Q222: Functional Status Change for Patients with Elbow, Wrist or Hand Impairments
• Q520: Functional Improvement for Patients with Back Impairments is replacing Q220: Functional Status Change for Patients with Low Back Impairments 
• Q521: Functional Improvement for Patients with Lower Extremity Impairments is replacing Q218: Functional Status Change for Patients with Hip Impairments and Q219: Functional Status Change for Patients with Lower Leg, Foot or Ankle Impairments
• Q522: Functional Improvement for Patients with Knee Impairments is replacing Q217: Functional Status Change for Patients with Knee Impairments

The Physical Therapy/Occupational Therapy Specialty Set is getting the usual spate of updates. 

Here are the changes listed for the other Quality Measures listed under the PT/OT specialty set:

Q050: Documentation of Current Medications in the Medical Record

• Updated value set/coding: For the eCQM collection type: Revised: Direct Reference Code (DRC) "Acute health crisis (finding)" (SNOMEDCT Code (705016005)) to value set 'Acute Health Crisis' (OID:2.16.840.1.113762.1.4.1248.429) to allow for additional conditions to qualify for the exception.
• Updated value set/coding: For the eCQM collection type: Revised: ‘Encounter to Document Medications' (2.16.840.1.113883.3.600.1.1609) to remove CPT code 99211 and add CPT code 92622 as outlined in the previous EK

Q130: Preventive Care and Screening: Screening for Depression and Follow-Up Plan  

• Modified collection type: Medicare Part B Claims Measure, eCQM, Medicare CQM, MIPS CQM, Medicare eCQM collection types. The measure description is revised to read: For the eCQM collection type: Percentage of patients aged 12 years and older screened for depression on the date of the encounter or up to 14 days prior to the date of the encounter using an age-appropriate standardized depression screening tool AND if positive, a follow-up plan is documented from the date of the screening to two days after the date of the qualifying encounter or an active depression medication or active depression management intervention was active or prescribed at any time on the date of qualifying encounter.
• Updated definition: For the eCQM collection type: Added: Active Depression Medication or Active Depression Management Intervention Documentation that patient is actively receiving interventions designed to treat depression such as behavioral health evaluation, psychotherapy, pharmacological interventions, or additional treatment options.
• Updated guidance: For the eCQM collection type: Added: clarifying language on screening tool to be used for screening a 17-year-old, and which screening should be used to satisfy the numerator. The measure numerator is revised to read: For the eCQM collection type: Patients screened for depression on the date of the encounter or up to 14 days prior to the date of the encounter using an age-appropriate standardized depression screening tool AND if positive, a follow-up plan is documented from the date of the screening to two days after the date of the qualifying encounter or an active depression medication or active depression management intervention was active or prescribed at any time during the qualifying encounter.
• Updated numerator definition: For the MIPS CQM, Medicare CQM, and the Medicare Part B Claims Measure collection types: Added: Prior screening within performance period: Patient previously screened by another clinician using an age-appropriate standardized depression screening tool with documented results within the performance period AND if positive, a follow-up plan is documented.
• Updated denominator exception: For the MIPS CQM, Medicare CQM, and the Medicare Part B Claims Measure collection types: Added: Screening for depression not completed, previous patient screening with results documented within performance period.  

Q288: Dementia: Education and Support of Caregivers for Patients with Dementia

• The measure description is revised to read: Percentage of patients with dementia whose caregiver(s), who are not part of the licensed care team, were provided with education on dementia disease management and health behavior changes AND were referred to additional resources for support in the last 12 months. 
• Updated intent and clinician applicability: Added: whose caregiver(s), who are not part of the licensed care team, were provided with education on dementia disease. 
• The measure numerator is revised to read: Patients with dementia whose caregiver(s), who are not part of the licensed care team, were provided with education on dementia disease management and health behavior changes AND were referred to additional resources for support in the last 12 months 

Q291: Assessment of Cognitive Impairment or Dysfunction for Patients with Parkinson’s Disease

• Updated denominator criteria: Added: coding for physical therapy 

Q317: Preventive Care and Screening: Screening for High Blood Pressure and Follow-Up Documented

• Updated denominator criteria: For all collection types: Added: coding for physical and occupational therapy.

Stay tuned for more on the final rule. 

That’s it for now.  And really, isn’t that enough for one sitting? Of course, we’ll be going into greater detail next month with a webinar on the final rule and what it means for rehab therapy practices, so keep an eye out for details coming soon.